St. Louis, MO: Real Estate Market & Trends 2016

The St. Louis real estate market has been in rebound mode for the better part of 2016. Home prices have gradually improved for the Gateway to the West, while appreciation rates, total equity, and home affordability continue their return to normalcy. The median home price for St. Louis real estate was $170,300 during the second quarter, compared to the national average of $239,167. Gains in the last three years have extended the trend of positive price growth after the recession. It appears, however, that price growth is slowing for St. Louis real estate, despite home prices being up from last year. Home affordability for the St. Louis housing market, on the other hand, is among the lowest in the country, which bodes well for future homeowners and renters. That said, the current St. Louis real estate market is primed for major investment activity in the coming years.

St. Louis, MO Real Estate Market Statistics:

Home appreciation rates for the St. Louis real estate market continued to disappoint in 2016. While price appreciation and principle payments in the last 3 years have boosted total equity growth since the recession, the total equity gained for St. Louis real estate was less than expected. The one-year appreciation rate was 4.1 percent during the second quarter, compared to the national average of 4.9 percent. The three-year appreciation rate didn’t fare much better, rising to 14.4 percent, whereas the rest of the country saw rates of 17.8 percent. For St. Louis real estate investors, however, this market is poised to become a haven of investment activity, especially in the second-half of 2016. For those considering St. Louis real estate investments, the following provides a breakdown of appreciation rates in previous years:

Homes purchased in the St. Louis, MO housing market one year ago have appreciated, on average, by $9,401. The national average was $14,963 over the same period.

Homes purchased in the St. Louis, MO housing market three years ago have appreciated, on average, by $29,328. The national average was $46,878 over the same period.

Homes purchased in the St. Louis, MO housing market five years ago have appreciated, on average, by $46,577. The national average was $82,353 over the same period.

Homes purchased in the St. Louis, MO housing market seven years ago have appreciated, on average, by $46,477. The national average was $77,054 over the same period.

Homes purchased in the St. Louis, MO housing market nine years ago have appreciated, on average, by $26,978. The national average was $31,126 over the same period.

As shown above, total equity gains for St. Louis real estate were far below the national average in year one through year nine. As such, this setting could set up potential investment opportunities for St. Louis real estate investing, especially if foreclosures become a trend.

As of August 2016, there are currently 2,913 properties in the St. Louis, Missouri area in some stage of foreclosure. According to RealtyTrac, the number of St. Louis foreclosures in the month of July was four percent lower than the previous month and nine percent lower than the same period in 2015. The number of REO properties in St. Louis decreased 10.1 percent from the previous month and 4.2 percent from the same time last year.

St. Louis, MO: Real Estate Market Summary:

Current Median Home Price: $170,300

1-Year Appreciation Rate: 4.1%

3-Year Appreciation Rate: 14.4%

Unemployment Rate: 4.9%

1-Year Job Growth Rate: 2.4%

Population: 318,416

Median Household Income: $52,343

St. Louis, MO: Real Estate Market (2016) — Q2 Updates:

The many bright spots for the St. Louis real estate market in 2016 include its growing economy and continual improvements to home affordability. During the second quarter, homeowners paid 7.2 percent of their income to mortgage payments, whereas the national average paid more than double: 15.8 percent to be exact. Even better, affordability in Q2 was less than its historical average of 9.5 percent, which is always great for homeowners and renters. However, new housing construction, or lack thereof, could impede home affordability for the second-half of 2016 and beyond. The current level of construction was 16 percent above the long-term average, while single-family permits rose slightly to 7.5 percent, but still below the national average of 10.6 percent. That said, construction in St. Louis is on the rise relative to last year, which suggest that local inventory could be stabilizing.

The one factor benefiting the St. Louis real estate market is the local economy. The unemployment rate is on par with the national average at 4.9 percent, but job growth continues to outpace the rest of the country. The one-year job growth for St. Louis was 2.4 percent during the second quarter, compared to the rest of the country of 1.9 percent. With employment holding up and on an upward trend, the local economy is strong compared to other markets.

Moving forward, the St. Louis real estate market is expected to grow consistent with the national average in the second-half of 2016. The National Association of Realtors (NAR) has forecasted lower price growth in St. Louis than in the U.S. in the next 12 months, with price expectations for St. Louis real estate anticipated to grow by 3.2 percent in the second-half, as opposed to the national average of 3.6 percent. The second-half of 2016 should be positive for the St. Louis real estate market.

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.

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